Determining the companys target debt-equity ratio, Finance Basics

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Determining the companys target debt-equity ratio

P & P communication has weighted average cost of capital of 9.5 perecent. The company's cost of equity is 15.5 percent, and its pretax cost of debt is 8.5 percnt. The tax rate is 34 percent. What is the companys target debt-equity ratio?

a. 0.89

b. 0.92

c. 0.98

d. 1.01

e. 1.54

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Finance Basics: Determining the companys target debt-equity ratio

Reference No:- TGS042402

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Recent Questions Asked Finance Basics

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Finance Basics: Determining the companys target debt-equity ratio

Reference No:- TGS042402

Recent Questions Asked Finance Basics

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